Archive | November, 2010

I Lost My Heart In Hertfordshire

30 Nov

Today I was in my lovely home county of Hertfordshire. I have to confess I love the area where I live as we are so close to London, major roads, airports, lots of nice restaurants and bars – and we have gorgeous fields and trees all around.  Also, I know I am biased – but the people around here are lovely as well and there is a strong sense of community spirit.

But back to the house!

So I went to see a 2 bed terraced house built in Victorian times and a few miles from me.  I knew it was an executor sale and so I expected it to be dated. It had a guide of £140k+.

It was dated inside, but had clearly been well loved.

Sadly it was also very small and the rooms felt extremely “cosy”! – especially once you start trying to get furniture in!

The kitchen was a “galley” style (with minimal units) and the bathroom was in a ground floor extension

The stairs upstairs were very cute and cottagey – and just look at the door to go up – it’s more like a cupboard door!

Unfortunately, while cute – probably not very practical and pretty difficult to manoeuvre furniture around!

The bedrooms were an OK size and just needed the usual decor (although you would have to budget for replastering as I’m sure the plaster would come away once you start stripping the wallpaper).  And I think these floorboards would look super once sanded and varnished!

Outside there was a very long garden which had lovely views over the surrounding fields and farmland.

All in all, the house had a lovely pleasant calming and “homely” feel…and I loved the area which was a quiet street in a well regarded village…


Let’s get practical – can you imagine the nightmare you are going to have trying to find a car parking space close to the house. I had to park and walk 5 mins to the house and that was during the day when most people are at work.

Look at this!

Also – let’s think about it – do people really want to live in such a small house with their modern “big” furniture??

So I stopped day dreaming about times gone past and how I could spend my days (if I lived there) making soup and jam, reading novels and philosophising about life and got realistic – and that meant putting my builders hat on. And it would be literally!

The only way this house could work is if I did a 2 storey extension and got some extra space! Planning shouldn’t be too difficult given a precedent has been set by the neighbours.

But is it a good use of capital? I have to admit – no – I don’t think it is. The house refurb and extension would probably cost me the best part of £50k and I can think of better projects which I should spend it on.

However all was not lost – on the way to the property I saw a lovely looking pub/ restaurant which I decided I should visit for a meal. I am pleased to report that The Rusty Gun had the most delicious food, lovely surroundings, wonderful staff and is a fabulous example of modern-rustic pub conversions!

If you are in the area – check it out.

The Joys Of Holiday Home Ownership

26 Nov

Today I thought I would update you on the progress of my holiday home renting. You may remember from my post Here that I sacked the agents in Fuerteventura and decided that I would rent my holiday home by myself. Yes, I know it sounded crazy as it was thousands of miles away – but I had, had enough of crap agents and decided that I would do it better!

Well I am pleased to say that I have done it better and thought I would share with you progress so far, so that if you have a holiday home/ are thinking of buying one then just to tell you – you too can manage your holiday home yourself! So my story today is one of encouragement!

I placed my ad for my holiday home rental on Click here for the ad

I had to pay upfront for the advertising for the year which cost me c£250. Not a small amount of money, but I decided that it was far cheaper than an agent. I had also manage to source a local cleaner and handyman for the property so that I could ensure that the property was well maintained and cared for.  We organised a system which all were happy with (i.e. how they were paid and how I informed them of the bookings)  When you are dealing with people in other countries email is a godsend!

I also decided I should use some free advertising and advertised the property on some local postcards in the supermarket and on gumtree (I didn’t put too much effort into this, but I tried it to see if I got any results)

I also made myself a little website one Sunday night – it is not fancy – but I did it so that I could write the address on my free ads:

And would you believe it within a short space of time I had taken so many bookings that I am now booked solidly until April 2011!

I am thrilled to say that I have also, at last, enjoyed being in control of my own holiday home! This means I also get to use it! My mum’s gone for a holiday, I’ve been for a hol, I’m going again next year with friends and I’m currently checking out cheap flights for Christmas 2011!

I always try and offer a much more personal service for people booking with me than if they went to an agent. So for example,  I will check with anybody booking how they are going to get to the apartment and recommend transfer agents. I also check they have enough info about the area and send them relevant weblinks which they can check through prior to arriving.

I also try and understand why people book my apartment – what is it about the apartment, area, complex so that then I understand more about the sort of people who are my customers. Through doing this “customer research” I can then add other services/ products to the apartment which would make their stay more enjoyable. This could be as simple as having a travel cot available, to having a selection of music CDs for them to play on the stereo. I can’t please everyone – but I can at least try!

When people are booking holidays it’s lovely as they are all so excited (and it rubs off on me!), and that means that emotions are heightened so that if something is not quite right I know that they will feel it is even more not right (if you get my drift). Fortunately, I have not had any problems or complaints – but I still worry! I try and anticipate what issues may arise and either prevent them or manage expectations. This could be things such as – we have free wi-fi – but I know, if lots of people are using the system it can be slow. And so I pre-warn people that while we have free wifi it’s not the broadband speed they are used to, and that because it is a communal system it can be very slow at times. By explaining to people these issues beforehand, it means that if they do encounter an issue (e.g. wifi is slow) then they are prepared and accept this as they have already been told and know what to expect.

While I confess I have been doing this for less than 4 months – it’s a positive “sunny” start!

Outbid For An Auction Property And I Wasn’t Even There!

23 Nov

Today I went to see a lovely little property which is just a few miles from my home. While the property is in a small market town it does have a main line fast train to London which gets you to Kings Cross in 40 mins. Also, it has good road links to Cambridge so it’s popular with commuters.

The property was a repossession which had in fact been empty for over 2 years before it had even been entered to auction! The agent was telling me this was usual and most properties which came to auction did so having been left empty usually for around 18months beforehand.  He then proceeded to tell me of another 8 properties in the town which he knew of which had been repossessed and which had been empty for over a year which had just been left by the lenders.

I have been in the game a while but even I was shocked to hear how long it took the various lenders, banks and organisations to get themselves organised enough to sell a property. What smacks of injustice is that all the while the borrower is having interest and charges added to the amount they owe.  It is awful – especially in cases where the property could be rented out in the meantime.   Not only that, empty properties are security risks and attract all sorts of vandals and criminal activity which can both impact upon the value of the property and bring the neighbourhood down.

Anyway – back to the property.  It was a 2 bed mid terraced house built about 18 years ago and had a guide of 95k. Now I know the area and I knew instantly that in good condition it would sell on for c.150k and rent for 600-650pcm. Given the proximity of the property to me and the fact it was a more modern build, on this property, I would therefore have accepted a much lower profit margin than usual.

So here are some external shots of the property and surrounding area. It’s a lovely friendly area:

So here is the lounge and kitchen:

Conservatory and garden (not a great picture as no back door keys so taken through the glass!)

Bedrooms and bathroom:

While the property doesn’t have any features or character – and there’s not much you can do to improve on what is there – this is still a solid little investment. It is a modern-ish mid terrace house which is ideally suited to first time buyers, can be sold in their price bracket and will have appeal due to it’s town centre location and great transport links.

I got the legal pack and was over joyed to see all was in order. I called my friend at the auction house and expressed an interest in this and another lot (more about that next time).  I was over the moon and I looked forward to doing an easy project just down the road from me.  I had worked out my sums and knew I was in for a really good chance on buying this.

So there I was cheque book in hand excitedly about to leave for the auction – and the phone rings.  It’s the auctioneer.

“Sam, he says, “I’m just calling about lot 20”

“Yes” I reply

“Well I know you’re coming to London today to bid on this”


“Well, I have just been informed that the bank have done a deal with a vendor who the estate agent introduced and they exchanged this morning for £105k”

“What” I retort “but I was going to pay more than that!”

“I’m sorry” he says “They’ve exchanged and there’s nothing we can do, it’s been withdrawn from auction. I just wanted to save you a trip as I knew you would be disappointed” and hangs up

And there I have to hang up my dream of doing an easy project close to home… 🙁

A Bad Day To Be A Landlord…

19 Nov

Today was not a good day.

I had been warned by the letting agent looking after my property in Derby that the property was a mess and the tenant lived like a pig.  They had issued letters for him to clean the property and the council had been called out several times by neighbours as the yard was an environmental hazard (note always do as the council say otherwise you can get into a lot of legal trouble!).

The tenant was an elderly guy who was ill and who really needed to go into a home as he was unable to take care of himself. He had family who came to visit the house but they did more harm than good (think of an episode of Shameless and you know the sort of people we’re dealing with).  In fact, the family caused a whole lot more trouble than the tenant and the police were regularly called by the neighbours as the kids were fighting, setting fire to the sheds and climbing on the roof…

Finally after months of liaising with the council, serving notice and a load more paperwork the tenant was finally re-housed in council accomodation….

So it was time for me to re-enter the property:

Here is the lounge:

Now you may notice that the property is a bit of a mess from the above photos….

You may also notice the front door is propped up against the wall rather than being attached in the door frame. This is because the door has been kicked in and was off it’s hinges….

Here is the kitchen:

Which doesn’t look that bad…but believe me the build up of inch thick dirt is there…and OH MY GOD

I did not even have the courage to photograph the insides of the cupboards – there was milk that had been kept in the cupboard for months, bread that was so old and mouldy it had disintegrated into grey powder and the mould was growing all internally in the cupboards. There were plants for the garden that were growing at the bottom of one of the cupboards!!!

And then we go upstairs to the bedrooms:

And it really annoys me that amongst all these belongings the tenant couldn’t find something to use as an ashtray rather than the floor!

But then in all this mess I guess they never noticed….

Then we have the “bird disaster” I say that because I swear they have been doing some wierd rituals with birds – there were feathers everywhere and then sacks of bird feathers…and did I tell you about the dog he hid in his bedroom which had pood everywhere…

And then just when you think it can’t get any worse…

I am on the phone to the agent…I had had 2 women (one of whom looked out of her face on drugs) come to the property claiming to be his daughter-in-law and going mental about her son’s fishing net.   I was really quite dumb struck – you leave me a shit hole like this to clear up and you’re going mental about a bloody fishing net!!!!!

So there I am on the phone to the agent…and as we only had 3 hours for the skip I am having to move stuff while juggling with the phone.  And so I start dragging this chair across the room…and suddenly I am hit by the most unbelievably disgusting smell. It makes me instantly gag and I turn round to see I have just moved a commode which was full of human urine and feaces which I have just started to spill on the carpet.

The putrid smell is overwhelming and quickly floods through the house. Mick who is in the kitchen starts shouting at me and is then outside throwing up, Will is wretching and has fled outside.

I am stood there on my own with a full commode. SHIT! (literally) . I have to move fast.

I grab the commode and get it out in the street and quickly find a drain which I can pour it down.  I am desperately trying not to breath so that I don’t have to smell THAT smell.  The stench is all throughout the street and the house….

AND THEN….just when you think things couldn’t get any worse….

We find the skylights have been removed, the cold water tank has been removed, the immersion heater has been pinched along with the copper piping, and the lead to my kitchen roof has been nicked!

How To Raise Finance For A Property Development

17 Nov

Today I wrote an article “How To Raise Finance For A Property Development” for Roberta Ward for her website – My Property Mentor. It was well received and so I thought I would share it here as well!

How To Raise Finance For A Property Development

So you’ve found your dream development project…now all you need is the money to buy it!  In today’s market it’s not easy to raise finance – but if the profit margins are there, people will listen and lend.

The first rule is that property development is a business.  Businesses exist to make money and that must be your focus.  You must continually question yourself and your plans to ensure you are going to make your projected profit margins. Forget the TV shows and stories about how glamorous property development is – forget the future lifestyle you are dreaming about. Fundamentally you are in property development to make money.  Stop dreaming and start doing.

Now we’re clear that property development is a business that is going to make you money, the next step is to draw up your business plan.  Your business plan is your key to raising finance for your property development. The business plan should be in place for each and every property you are thinking about developing.   You should write down all your findings – no matter how well you think you know it – writing your plan down clarifies your thinking, gives you focus and highlights any potential pitfalls.  It is easy to get carried away by the excitement of a project and a business plan keeps you grounded and on track.

The business plan should detail the area, the reasons why you’re buying, the current supply of properties on the market and the demand for properties in that area.  You will need to talk to local agents about the market, research house prices, check land registry figures and be aware of what is happening in the wider market (e.g. employers, schools and transport in the area). Note down anything that may impact upon your property sale. Think about your target market (who you’re going to sell to) and if anything is happening which may influence them to buy or not buy your property.  It doesn’t have to be reams of page long but it should show a proven market for your product.

Once you’ve got all your research together for your area and the property, you need to get down to the nitty gritty of the numbers.  The number 1 rule is not to massage the figures to suit you.  You may have found (on the surface) a great opportunity  – but you need to make sure the figures add up and that you are going to make money. There is no point doing a development project where you work for free.  This means you have to include all the costs of the development and a profit margin for you. You will need to get quotes together for the work you plan to undertake, the financing costs of the development (remember you will still have to pay interest on the loan while you are doing the works), buying and selling costs, and legal costs.

You also need to factor in what you are going to live on while you are doing the development work. Many developers will take their wages at the end of a project when it sells – however it is important to note that the costs are front-loaded. What this means is that you will need to have money ready to support you and live on while you are doing the project. Your living costs and bills will still need to be paid during a project and this has to be accounted for if you are working full-time on a development project.  This is often over-looked and can be the downfall of many projects.

Now that you’ve got your business plan together of the market, the costs of the project and how you’re going to survive during the development you should be clear about the profit involved.  Remember to cost for your time – unless you want to work for free!  Make sure that a development is going to be worth the time, risk and money involved.  It is important that you try and quantify what the different risk factors are and price for them accordingly.  If a project is going to take a long period of time make sure you calculate why it is worth taking on such a project. Everything boils down to risks and rewards. The key is in ensuring you have the right balance of risk to reward in a development project.

Once you have your business plan in place you can start approaching people to discuss raising finance for the project.  You need to make sure your business plan is easy to read and understand – and importantly highlights the figures of the project. There are several places you can go:

1. Mortgage broker. A mortgage broker has access to deals which “Joe Public” may not be able to access. There are some specialist development mortgages out there (e.g. TMW) which allows you to borrow and develop the project.  Specialist development banks have also entered the market (e.g. Aldemore) which allow you to raise finance to develop a project.

2. High street bank. Some banks such as LloydsTSB and RBS are lending on development projects. Arrange an appointment with a local bank manager, take your business plan with you and show them what you are looking for. Commercial lending does exist for development projects.

3. Friends and family. You may be surprised how much money some of your friends and family have stashed away in the bank and who are willing to lend on a project. The key is in ensuring you show the business plan and treat any funds they lend as a business arrangement. You can offer a good rate of return for any money lent, or maybe even a profit share.

4.       Joint venture. There are a good number of people who are looking to collaborate and combine financial resources and knowledge.  Most times, this will involve some sort of profit share.  Get to know people in property by getting involved in property forum sites and networking events where you may get talking to someone who also wants to share the financial risks and rewards of a project.

Finally, always remember that property development is a business. Raising funds is part and parcel of any successful business.  Your business plan is your manual on how you will make money. Get this right and you will soon be on your way to building a successful property development business.

Roberta’s blog can be found :Here